China is largely getting out of the Bitcoin mining business. That’s because the process is extremely energy hungry and China was supplying it mostly with fossil fuels – hurting its climate change goals.
Some Texas leaders have suggested the Lone Star State might be a good alternative location but Jake Dean reports for Slate that the required energy consumption ought to be a deterrent.
“So if we turn to the Bitcoin Energy Consumption Index, which is an attempt to actually estimate the amount of energy being used, just from a couple of days ago, the current estimates are about 133 TWh (terawatt hours) per year,” Dean said. “Which to put that in perspective, that’s about the energy usage of the entire country of Argentina being dedicated to Bitcoin mining and Bitcoin transactions.”
Bitcoin mining basically involves using computers to solve very complex problems to ensure the security of the cryptocurrency.
“What you’re doing is adding your computer processing power in order to access these bitcoins and help keep the network secure,” Dean said. “And you’re rewarded for doing so by actually gaining bitcoins or mining them in order to build value for yourself.”
Former Gov. Rick Perry and U.S. Sen. Ted Cruz are among the Texans who have touted the job opportunities Bitcoin mining could bring to the state.
“Because energy prices are so cheap in Texas, Bitcoin miners see it as a fantastic landing spot,” Dean said.
But among the problems with that idea is the uncertainty surrounding the stability of Texas’ energy grid.
“When we look at all the issues that the grid has had over this past year with the winter blackouts in February and issues with weatherizing – the fact that Texas is an independent grid with no reserve margin and some significant transmission reliability issues – bringing this massive, massive amount of energy to Texas could be truly problematic for the long term stability of the grid,” Dean said.
